Putting a Best Foot Forward

Best Buy has bitten the profit-margin bullet. And it seems to have emerged bruised but on a better track.

The retailer, which has focused on lowering prices to match those of online competitors such as Amazon.com, said Thursday that those moves came with a lower hit to profitability in the all-important fourth quarter than investors had feared. Best Buy's operating margin fell 1.2 percentage points, compared with the decline of...